Guide to Employee Types

First up, we define who is considered to be an employee. A definition provided by MBIE sums it up succinctly as being, ‘a person who has agreed to be employed to work for some form of payment under a contract of service’. Noting that a ‘contract of service’ is an agreement between an employer and an employee, typically referred to as an employment agreement.

So now we know who is deemed to be an employee, we can focus on the main types of employees. For this blog I’m focussing on outlining what I would consider as being the three main types, which are:

Permanent (full-time or part-time)

Fixed Term (full-time or part-time)

Casual

A permanent employee will be either employed on a full-time (generally 35 hours plus per week) or part-time basis. The work they complete would be considered as ongoing and expected to continue for an indefinite period.

A fixed term employee will be either employed on a full-time or part-time basis for a specific period of time, there must be a genuine reason based on reasonable grounds for the fixed term. A fixed term employee is most commonly used to cover seasonal employment (i.e. working in fruit picking), covering the work of an employee who is on parental leave, or completing project related functions that will end when the project ends. The beginning and end dates of the fixed term must be stated in the employment agreement, along with the reason why the contract will be fixed term.

Its timely to note here that employers cannot use a fixed term agreement instead of a trail or probationary period to test whether or not an employee is right for the position. This would not be accepted as being a genuine reason for the fixed term.

A casual employee does not have any defined or guaranteed hours of work, have no regular pattern of work, and no ongoing expectation of employment. I like to sum it up as the work is ‘as and when required’, noting that the employee doesn’t have to accept work if its offered by the employer. The employment agreement must clearly state the uncertain hours and casual nature of the work.

In any case, all paid employees must have a signed employment agreement specific to their position and employee type. TBD HR can compile suitable employment agreements for employers and provide guidance and advice when deciding what type of employee will best suit your business needs. Feel free to give me a call to chat about your employment agreements.